Madison’s North America Heating Wood Pellet Market Update: July 2026


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Québec Government and Indigenous Community to Build Pellet Plant

Provincial energy utility Hydro-Québec recently reached an agreement with the Atikamekw community of Opitciwan and Société en commandite Onimiskiw Opitciwan (SCOO) to finalize a 4.8 MW biomass cogeneration plant that will replace the community’s existing diesel-fired power unit. The new facility will cut diesel consumption by roughly 85 per cent, while reducing odour and noise pollution and lowering the volume of wood products and diesel fuel that need to be transported to and from the remote community.

Commercial operation is expected to begin shortly at the new plant, which carries an estimated cost of CAD$60.2 million with much of the funding coming from provincial and federal government grants. Hydro-Québec will also fund the acquisition and installation of a dryer at the Opitciwan sawmill.

The facility will operate under a 25-year agreement, including an option for a further 15-year extension.

Around 40 workers were hired for the construction phase, while approximately 15 permanent jobs will be created once the facility is up and running.

New Patent Granted for High-Pressure Reactor Feed System

Powder and bulk solids storage, handling, conveying, and processing company Jenike & Johanson has been awarded a patent for a novel feeding technology for high pressure biomass reactors. The innovation addresses a persistent practical problem in biofuels manufacturing wherein bridging, compaction, and flow instability occur when introducing low-density feedstocks into high-pressure reactor systems.

The patented system addresses this by using a diverging approach which allows feedstock materials to discharge in a near free-fall manner, promoting stable flow without restriction leading to compaction. The company says systems based on the new technology are capable of handling up to 1,000 tonnes per day of biomass or municipal solid waste.

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Global Wood Pellet Production Hits Record High

According to Bioenergy Europe’s latest Pellet Statistical Report, global production of wood pellets reached a record 53.5 million tonnes in 2025. This volume represents a 10 per cent year-on-year increase and underscores the growing strength of the sector in recent years.

Global consumption of biomass also hit a new all-time high of 51.5 million tonnes, confirming steady demand across both industrial and residential heating sectors.

Another historical high was achieved in small-scale pellet consumption in Europe, which exceeded 19 million tonnes with residential consumption alone up five per cent over 2024 to 15.3 million tonnes.

Investigation into Drax’s Canadian Biomass Disclosures Terminated

The Financial Conduct Authority (FCA), a UK financial services regulator, recently closed its investigation into Drax Group’s Canadian biomass operations, finding no evidence to justify further action. The investigation involved examining the company’s annual reports and accounts for 2021, 2022, and 2023 for misleading statements or omitted information pertinent to investors.

The FCA apparently reviewed thousands of pages of material and interviewed individuals from the company as part of the probe, focussing specifically on disclosures relating to the sustainability of Drax’s Canadian biomass supply.

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Madison’s Heating Wood Pellet report is a monthly publication, tracking U.S. and Canadian commercial and residential heating wood pellet prices. It includes detailed data on wholesale commercial/retail prices, production volumes, sales, export volumes and values, competing home heating fuel prices, plus more.